Assume the Current Spot Rate Is Can$1

question 52

Multiple Choice

Assume the current spot rate is Can$1.0267 and the 1-year forward rate is C$1.0259.The nominal risk-free rate in Canada is 2.5 percent while it is 2.1 percent in the United States.If you use covered interest arbitrage,how much extra profit can you earn over that which you would earn if you invested $1,000 in the United States for 1 year?

• A)$)21
• B)$4.22
• C)$4.80
• D)$)24
• E)$0

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Definitions:

Ideal Self

A person's conception of how they would like to be, often serving as a guide for self-improvement or motivation.

Personal Identity

This refers to an individual's conception and expression of their own uniqueness or individuality, as well as the aspects of themselves that persist over time.

Self-Conceptual Integration

The process of incorporating various aspects of the self into a coherent and unified sense of identity.

Fragmented Self

A psychological state where an individual's identity is divided into multiple parts, leading to a lack of a unified sense of self.